Spotting Winners: Sensata Technologies (NYSE:ST) And Analog Semiconductors Stocks In Q2

Let’s dig into the relative performance of Sensata Technologies (NYSE:ST) and its peers as we unravel the now-completed Q2 analog semiconductors earnings season.

Demand for analog chips is generally linked to the overall level of economic growth, as analog chips serve as the building blocks of most electronic goods and equipment. Unlike digital chip designers, analog chip makers tend to produce the majority of their own chips, as analog chip production does not require expensive leading edge nodes. Less dependent on major secular growth drivers, analog product cycles are much longer, often 5-7 years.

The 15 analog semiconductors stocks we track reported a mixed Q2. As a group, revenues beat analysts’ consensus estimates by 1% while next quarter’s revenue guidance was 1.2% below.

Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market was optimistic at the end of 2023 due to cooling inflation. This year has been a different story as mixed inflation signals have led to market volatility, and analog semiconductors stocks have had a rough stretch. On average, share prices are down 8.1% since the latest earnings results.

Sensata Technologies (NYSE:ST)

Originally a temperature sensor control maker and a subsidiary of Texas Instruments for 60 years, Sensata Technology Holdings (NYSE: ST) is a leading supplier of analog sensors used in industrial and transportation applications, best known for its dominant position in the tire pressure monitoring systems in cars.

Sensata Technologies reported revenues of $1.04 billion, down 2.5% year on year. This print was in line with analysts’ expectations, but overall, it was a weak quarter for the company with underwhelming revenue guidance for the next quarter and a decline in its gross margin.

“We are pleased to report a solid second quarter with performance in line with expectations," said Martha Sullivan, Interim President and CEO of Sensata.

Unsurprisingly, the stock is down 7.2% since reporting and currently trades at $35.19.

Read our full report on Sensata Technologies here, it’s free.

Best Q2: Himax (NASDAQ:HIMX)

Taiwan-based Himax Technologies (NASDAQ:HIMX) is a leading manufacturer of display driver chips and timing controllers used in TVs, laptops, and mobile phones.

Himax reported revenues of $239.6 million, up 2% year on year, outperforming analysts’ expectations by 2.9%. It was an exceptional quarter for the company with a significant improvement in its gross margin.

Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 8.2% since reporting. It currently trades at $5.38.

Is now the time to buy Himax? Access our full analysis of the earnings results here, it’s free.

Weakest Q2: Universal Display (NASDAQ:OLED)

Serving major consumer electronics manufacturers, Universal Display (NASDAQ:OLED) is a provider of organic light emitting diode (OLED) technologies used in display and lighting applications.

Universal Display reported revenues of $158.5 million, up 8.1% year on year, in line with analysts’ expectations. It was a weak quarter for the company with a miss of analysts’ EPS estimates and full-year revenue guidance missing analysts’ expectations.

As expected, the stock is down 14.3% since the results and currently trades at $182.10.

Read our full analysis of Universal Display’s results here.

ON Semiconductor (NASDAQ:ON)

Spun out of Motorola in 1999 and built through a series of acquisitions, ON Semiconductor (NASDAQ:ON) is a global provider of analog chips specializing in autos, industrial applications, and power management in cloud data centers.

ON Semiconductor reported revenues of $1.74 billion, down 17.2% year on year, in line with analysts’ expectations. Zooming out, it was a weak quarter for the company with underwhelming revenue guidance for the next quarter and an increase in its inventory levels.

The stock is down 3.4% since reporting and currently trades at $67.80.

Read our full, actionable report on ON Semiconductor here, it’s free.

Monolithic Power Systems (NASDAQ:MPWR)

Founded in 1997 by its longtime CEO Michael Hsing, Monolithic Power Systems (NASDAQ:MPWR) is an analog and mixed signal chipmaker that specializes in power management chips meant to minimize total energy consumption.

Monolithic Power Systems reported revenues of $507.4 million, up 15% year on year, surpassing analysts’ expectations by 3.4%. Taking a step back, it was a strong quarter for the company with optimistic revenue guidance for the next quarter and a decent beat of analysts’ EPS estimates.

The stock is up 1.8% since reporting and currently trades at $800.56.

Read our full, actionable report on Monolithic Power Systems here, it’s free.

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